Cindy is playing by the ocean with her younger brother, Neil, when a ghost appears out of nowhere and grabs the little boy and carries him away. Cindy tries to tell people what happened, but everyone assumes that Neil drowned. Cindy is left heartbroken, with no one to help her find her brother. Until Sally reads about what happened. Sally believes in ghosts-and she knows there are plenty of them to be found in Spooksville. With Adam and Watch, Sally...

There is a famous cave located just outside of Spooksville. A lot of stories surround the dark place-scary ones as well as exciting ones. Adam decides to explore the cave with his friends Watch, Sally and Cindy. But the moment they step inside the cave, the entrance closes behind them. Trapped, in the dark, they walk deeper and deeper into the cave, frantically searching for a way out. But the batteries in their flashlights begin to run low. And then...

Talked into venturing to the fearsome otherworld dimension of the Secret Path by Bum, who has learned of a super-fun place there, Adam and his friends ignore Sally's reservations and find more than they expect.

Adam and his friends find a black cat in the area around Spooksville and it follows them home. Then strange things begin to happen and the cat won't go away.

The time has come for Adam and his friends to again face Spooksville's most powerful citizen, Ms. Ann Templeton. Sally says the woman is definitely a witch, but Adam and Watch are not so certain. To find the truth, they visit her castle together. There they find both good and bad: creatures more horrible than anything they could imagine, but also magical tools that can create the most wonderful things.